The bold logo sweaters, stripes and – not to forget, bath towels – were all the rage from Esprit’s 80’s phase. To think the brand was once a blue-chip company, only to have fallen so far. Susie and Doug Tompkins – also the owners of The North Face – founded Esprit in 1968 and the brand was taken over by Hong Kong businessman Michael Ying to its heyday in Asia throughout the 90s. However, the birth of fast fashion and the rise of the millennials soon pushed Esprit out of the game – and the Hang Seng Index – in 2013, sparking a continuing downward spiral for the years to come.
Then the pandemic arrived, shaking Esprit back to reality, resulting in it closing 56 stores in Asia ending another attempt to rebuild the brand. Gearing up post-recovery, the German label has relocated back to its home base in Hong Kong, restructuring with a new team, a mixture of retail veterans and fresh blood.
After years of unimaginable losses, the brand claims to be completely self-funded and debt-free and even achieved a second consecutive profitable half-year since its return. Entering a new market every eight weeks, the brand ambitiously plans to open seven e-commerce markets atop the existing four in Asia, in addition to an innovative hub – Esprit Futura – and more pop-up stores across the globe.
As Esprit focuses on re-establishing its market positioning and rebuilding its brand equity once again, perhaps the European label just might actually make a dent this time round.
The large ‘Love, Esprit’ scrawled across the three-storey high flagship store casts a vibrant, youthful image much different from the brand’s signature red facade of old. Upon entering, the customer is greeted with Joy, Esprit’s inclusivity mascot dolphin, in a holographic origami form.
Turn the corner, a gallery-style heritage wall plastered with old posters harking back to times when the brand was still relevant, acts as an idle background to an art installation paying tribute to the 80’s Memphis Design style. There’s a random seesaw in the corner.
A lady in her 50s with a younger friend in tow excitedly poses against the backdrop to post on Facebook later and revels about her Esprit wardrobe back in the day. Today, she leaves empty-handed.
Ushered into an elevator and to the top is ‘Joyground’, a lounging area decorated with neon lights, pastel furnishing, and an empty coffee cart. Instagrammable experience lounges are one thing, but given a monthly rent of HK$250,000 (US$31,800) – or HK$28.1 per square foot, is an entire floor of wasted, valuable retail space.
Supposedly a rotation of local cafe pop-ups will appear but for now, there’s a click-and-collect counter for mooncakes. No clear attempt at interactive experience was evident – purely a resting spot and free aircon from the overbearing heat of Causeway Bay streets.
Down on the second, and main, floor is Esprit’s retail offering – the ‘Fashion Closet’. A man in his sixties murmurs to himself “Wasn’t this the American brand that closed down?” only to be awkwardly corrected by sales staff about its reform.
Esprit’s new Black Label line features items at higher price points in contrast to the youthful pieces from its White Label range. Key items range from bland $259 cotton t-shirts to a $2199 patent leather coat. Black Label prices seem steeper than at Brandy Melville next door where a throng of teenage girls pays half that for basics. In a feeble attempt at being omnichannel, QR codes – seemingly printed on an inkjet printer barely held together with blue tack – are displayed, directing customers to view the same items online.
While Esprit’s price points are not absurdly high for a working millennial, there is no education shown to justify the cost. Albeit not being the most affluent lot, a third of these educated and environment-loving Gen Z cohort are willing to spend more on sustainable items. A little bit of research online shows Esprit’s partnership with Archoma, a sustainable solution for colour dye, and 100 per cent circular denim collection. Had Esprit illustrated these green points instead of remaining fixated on Instagrammability and an overload of visual throw-ups, the brand would have landed cash in the till.
Having already lost its plot, Esprit fails to establish its brand identity to the new generation – the same crowd that is unaware of Forever21’s existence. Educational elements in reintroducing the brand to its new era and evoking fond memories of the past would have at least stirred the interest of browsing shoppers. Had the brand made the effort to school Gen Z’s on how to style archive pieces in modern-day looks through user-generated content (UGC) or an Instagram Reel through its digital displays, this would’ve captured their interest. Between office lady rayon dresses and cargo pants (a new Gen Z staple), the brand has missed the chance to mark its identity among the spectrum of consumers it aims to target.
Last, but not least, a digital device resembling a vending machine stands awkwardly at the back of the store. Like another ‘tick-off retail bingo’ this device features a virtual claw-machine game. Fumbling with their phone on the spot, shoppers need to go through a whole series of steps to sign up for an account, customise their avatar from head-to-toe, and then re-enter their details on the screen before playing a game – all in exchange for a discount.
Completely dissociated from the game but simply a tactic to earn customer data, Esprit thought encompassing virtual avatars would make it relevant in today’s digital culture. Esprit has a virtual showroom on its website, which does nothing except scroll around a 3D product catalogue. To really engage the consumer with immersive digital experiences, the brand could have instead leveraged its Snapchat presence, enabling Gen Z kids to customise their avatar in Esprit clothing whilst enticing others to put on an Oculus headset to take a trip down memory lane of Esprit and Hong Kong’s glory days. Or, it could have removed the friction and unnecessary tech gimmicks for an actual claw machine for hidden surprises and instant gratification.
The 90s comeback
The booming 90s nostalgia trend was already handed to Esprit on a silver platter, so given Esprit’s heritage, it should have been easy to join the ride. Brands from the 90s like Fila, K-Swiss, and Champion have all returned to the high-street and sneakerhead boutiques fuelled by the excitement of older customers who had worn the labels decades ago, and even younger generations discovering them for the first time.
These brands bring with them strong digital marketing and partnership initiatives. A collaboration with Supreme and Asos opens up doors to new audiences and appreciation, lending street cred to their name. In another example, Abercrombie managed to completely reinvent itself after realising sex doesn’t sell – especially to an inclusive generation. Swapping dark, musky shops for brightly lit spaces, replacing hunky models with everyday people, and amping up its digital presence with TikTok exclusives has rightfully earned the brand back a place on the cool list with Gen Z. These brands learned to exist where the customers are – dressing edgy influencers and musicians, which to Esprit’s credit has also been doing with Block Parties and designer collaborations, landing itself attention and a rack in Hypebeast. So why does Esprit still not have the same ‘It’ factor?
As if building a fantasy football league, the brand has brought in the creme de la creme of CEOs from the industry, hoping for a miracle fix, but instead has been met with a revolving door of CEO exits – all of whom have bowed out from the challenge and ultimately failed to right the ship. Yet even with the latest infusion of experienced experts, there is a sense that perhaps they have lost touch with the customer base the brand is now courting.
Esprit could have capitalised on its 54-year legacy and signature core pieces, reconnecting with loyal nostalgic fans in older demographic groups. Instagrammable experiences may seem like an easy marketing tool but surface-level presentations fail to convert. Brands need to paint the lifestyle, and express their values to slowly build relationships with – and win over – customers.
With both young and new consumers, Esprit needs to keep its ears to the ground and notice customers’ changing needs if it wants to develop for the future and elevate itself as a brand worth wearing. This is a message to the same brand that has just launched a collection of skinny jeans – something Gen Z has already ruthlessly cancelled.
It is laudable for the brand to try again despite having endured multiple setbacks while attempting revivals in the past. However, while Esprit has the resources and is heading in the right direction, the brand has lost its focus and identity in its latest attempt to stay relevant. It is failing to connect with the consumers that truly matter.